Article by Miles Klee, MIC
Legal weed sales are booming. And in certain states, prices are plummeting.
This wasn’t entirely unexpected. While Forbes called 2016’s 30% spike in marijuana sales (a whoppin $6.7 billion) a bigger, faster industry explosion than we saw in the dot-com era, weed policy experts, retailers and growers have long known that legalization also cuts costs.
“We anticipated that the price of marijuana would drop substantially once the adult-use vertical-integration requirements were removed in Colorado in late 2014,” said Sally Vander Veer in an email. Vander Veer is president of Medicine Man, a major marijuana cultivation dispensary in the state. “We saw hundreds of cultivators move into the cannabis space, and once their crops were ready, [we] saw a steady and rapid decline in the wholesale price per pound of marijuana.”
After all, cannabis is just a plant, and the circumstances that made it worth up to $5,000 per pound under prohibition — namely, the risk of arrest, covert business operations, lack of standard regulations, etc. — simply don’t exist in a legal weed economy, whether it’s being grown for recreational purposes or medicinal needs.
Factor in the potential savings of growing the stuff on a mass scale instead of in your basement and the price drops even further. According to the Washington Post, “wholesale prices in Colorado tumbled 24.5% over the past year to $1,471 per pound” as the pot industry took off in the state.